Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
30 Cards in this Set
- Front
- Back
|
Exclusive Right-to-Sell contracts list specific services the broker will offer. Those services: are not limited to those preprinted on the contract are limited to those specified include disclosing psychologically impacting information are to be added at a later date outside of the body of the contract |
A: are not limited to those preprinted on the contract Brokers may not disclose any psychologically impacting information; each listing contract must contain all services/requirements of each party to the contract. Other services may be added in the additional provisions section or by an amend & extend form. |
|
|
The listing contract that provides the most protection for the broker is a(n): exclusive brokerage listing open listing exclusive right-to-sell listing net listing |
A: exclusive right-to-sell listing An exclusive right to sell listing contract provides the most protection for the broker. This contract engages the broker and guarantees a commission regardless of whether the seller or the broker initially found the buyer. |
|
|
If a defaulting buyer forfeits an earnest money deposit, based on the language of the Colorado exclusive Right to Sell Listing Contract: Broker would receive the funds Seller is entitled to keep the funds Broker and Seller would split the funds Broker and Seller would submit the funds for mediation |
A: Broker and Seller would split the funds It specifically is stated in the contract that the Broker and Seller will split the funds.More on the process of returning Earnest Money:The Colorado Contract to Buy and Sell Real Estate (AKA Purchase Contract) says the agent holding earnest money has 5 days to return earnest money to whomever is supposed to get it after receipt of written instructions to do do. This is covered in the Broker Acknowledgements sections of the purchase contact.The actual language reads like this - "Broker agrees that if Brokerage Firm is the Earnest Money Holder and, except as provided in § .., if the Earnest Money has not already been returned following receipt of a Notice to Terminate or other written notice of termination, Earnest Money Holder will release the Earnest Money as directed by the written mutual instructions. Such release of Earnest Money will be made within five days of Earnest Money Holder’s receipt of the executed written mutual instructions, provided the Earnest Money check has cleared."BUT!!!!!! to make it even more fun for you, the Real Estate has issued Commission Position 6, whereby they say that if there is no controversy over who gets the earnest money, they want the money returned as quickly as possible and the agent does NOT have to get written permission from all parties to do so.Most companies as a prudent measure have both parties sign that they agree who gets the earnest money, before they release it. This just makes sense, woe to the agent who releases the earnest money and one of the parties throws a fit over it. Safer to get the parties to agree in writing first.However, sometimes the party that is giving up the earnest money and their agent makes this a pretty low priority on their things-to-do-list. Keep in mind, they are grumpy the deal is dead and even if they know they need to release the earnest money, they are not happy about it. In the meantime, the other party wants their money. Buyers in particular are anxious as they are back on the market looking for a property and can’t make an offer until they get their earnest money returned. Therefore, the Commission has made is very clear, that they do not want slow paperwork to hold things up when there is no controversy.Does this occasionally put us in an awkward position? Yup. Smart agents who do not like to even get within sniffing distance of having to write out a personal check to cover a perceived, if not actual screw up (that be me, except my wife would probably dispute the "smart" assertion) will move heaven and earth to get quickly signed releases by both parties before releasing earnest money.If you find that one of your parties due to the stress of the failed deal ran instantly to consult with the yogi on the mountaintop and are not returning messages. You need to have a talk with your managing broker before doing something you may regret. It is always cooler to share the love and say "my managing broker said to do it and will make it good" then "how do I spell your name on my check". |
|
|
In the event that the seller and broker have a dispute about the Exclusive Right To Sell Listing Contract, which of the following is true? Both agree to submit to arbitration with the local REALTOR association. Both agree to submit the matter to binding mediation. Both agree to mediation before proceeding to arbitration or litigation The matter must be resolved by a real estate commission hearing. |
A: Both agree to mediation before proceeding to arbitration or litigation In a Exclusive Right To Sell Listing Contract both agree to mediation before proceeding to arbitration or litigation |
|
|
A broker has an exclusive right to sell listing with a seller as a transaction broker. When a potential buyer calls on this listing, the broker must disclose? Nothing until the potential buyer has seen the property In writing that the broker represents the seller exclusively and that the buyer will have no working relationship with the broker's company Nothing since state law makes the licensee the buyer's transaction broker by default In writing that the broker works with the seller as a transaction broker and will owe the same duties to the buyer in the purchase transaction. |
A: In writing that the broker works with the seller as a transaction broker and will owe the same duties to the buyer in the purchase transaction. A transaction broker working with the seller will automatically owe the same duties to an unrepresented buyer. The broker must disclose this in writing. |
|
|
The Commission approved written listing contract: must have a definite termination date limits the commission to 10% of the selling price cannot be effective for more than four months cannot be effective for more than six months |
A: must have a definite termination date All contracts in Colorado must have a termination date. |
|
|
The “holdover clause” in the Exclusive-Right-To-Sell Listing Contract protects the listing broker’s commission for disclosed buyers: Usually for 60 days after the expiration of the contract For the period of time specified in the contract even if the property is relisted by another broker and the "Shall Not" box is checked For the period of time specified in the contract, or if the "Shall Not" box is checked until the property is relisted with another broker For up to six months after the listing expires |
A: For the period of time specified in the contract, or if the "Shall Not" box is checked until the property is relisted with another broker The Holdover Period says that a listing broker may be entitled to a commission after the expiration of a listing contract for the period of time specified in the clause if: 1) the broker negotiated with the buyer during the listing period and 2) the broker submitted the name of this buyer in writing to the seller. Although the protection is for a negotiated time after the listing expires; it can terminate early if the property is re-listed by another agent and the "Shall Not" box is checked, meaning the old listing agent "shall not" be owed a commission if another brokerage firm has earned one. If neither the "Shall" or "Shall Not" be owned a commission" box is checked - the default is "Shall Not". See "Holdover Period" in the "When Earned" clause of an Exclusive Right to Sell listing agreement. |
|
|
Commission-approved listing forms provide for the: owners to accept terms other than those stated in the listing brokers to receive a 5% commission owners must accept the price as indicated in the contract if offered brokers to consult with their managing broker before setting the price |
A: owners to accept terms other than those stated in the listing Owners are allowed to accept any terms presented to them in an offer or not. They cannot be forced to sell. A real estate commission is always negotiable so the exact percentage would never be preprinted in a standard form. It would only be inserted after negotiation with the seller. The selling price is set by the owner - the managing broker need not be consulted. |
|
|
A seller hired broker N under the terms of an open listing. While that listing was still in effect, the seller without informing broker N, hired broker K under an exclusive right-to-sell listing for the same property. If broker N produces a buyer for the property whose offer the seller accepts, then the seller must pay a: full commission only to broker N full commission only to broker K full commission to both broker N and broker K half commission to both broker N and broker K |
A: full commission to both broker N and broker K In an open listing who ever sells the property receives the commission, this means N by bringing a buyer is entitled to a commission. In an exclusive right to sell listing, no matter who sells the property, the broker who listed the property will receive a commission. This means K will receive a commission. Therefore the seller would be responsible to pay both brokers a commission. |
|
|
A listing agreement may be terminated for all but which of the following reasons? Sale of the property Agreement of the parties Death of the agent who took the listing Destruction of the premises |
A: Death of the agent who took the listing The parties to a listing agreement are the Seller and a Brokerage Firm. The licensee is the person signing on behalf of the Brokerage Firm. The death of the licensee does not in itself terminate the listing contract as the agent was not a party to the agreement. The death of either the Seller or the dissolution of the Brokerage Firm would. |
|
|
Regarding the broker/seller relationship under the terms of an Exclusive Right-to-Sell listing contract, which of the following statements are true? The broker may be the seller's agent and a transaction broker for the buyer The broker can take the listing without being an agent of the seller The listing must have at least a 60 day holdover period The listing has to be for at least thirty days |
A: The broker can take the listing without being an agent of the seller A broker may list a property as either a Seller's Agent or Transaction Broker. Only a Seller's Agent is considered to be an "agency relationship." Transaction Broker is considered to be a "working relationship." In an agency relationship you are an advocate for the client and owe the client your loyalty. In a working relationship you are a neutral party, advocating for neither the buyer or the seller but are instead just a facilitator for the transaction. Under NO CIRCUMSTANCES can you be an agent for one party and a transaction broker for the other in the same transaction. That would have the effect of you telling one party you are working for them (Buyer or Sellers Agency) and the other that you are a neutral party (Transaction Broker). That would be dishonest. |
|
|
If a broker as agent with an exclusive listing receives two offers for the same house at the same time—one from his salesperson and one from the salesperson of a cooperating broker—the broker should : submit his salesperson’s offer to the seller submit the highest offer reject both offers submit both offers |
A: submit both offers Broker must submit all offers and let the seller choose which one they would like to accept. |
|
|
A Listing based on a “net price” is: more profitable because no minimum is set on the amount of commission collectible legal in Colorado as long as the seller agrees. illegal in Colorado at any time. permissible with approval of the commission. |
A: legal in Colorado as long as the seller agrees. A net listing is legal in Colorado as long as the seller agrees. It may be problematic if the commission received is unjustifiably exorbitant. |
|
|
Which monetary encumbrances should be listed by the seller when completing the Exclusive-Right-to-Sell Listing Contract? all encumbrances known to the seller all encumbrances the seller will not pay off only encumbrances of public record all encumbrances to be assumed by a buyer |
A: all encumbrances known to the seller The seller should list all encumbrances known at the time of the listing. The status of these encumbrances after the property is sold would not be relevant (or known) at the time of the listing. |
|
|
Kevin, a real estate broker, sold a property and received a 6-1/2% commission. Kevin gave the selling broker 30% of the commission, or $3,575. What was the selling price of the property? 55000 95775 152580 183333 |
A: 183333 $3,575 (agent share of commission in dollars) / 30% (agent share of commission as a percentage) = $11,916.666 (total commission in dollars) / 6.5% (total commission as a percentage) = $183,333.32 (Selling Price of Property) |
|
|
By executing a listing agreement with a seller, a licensed broker has: become a procuring cause agreed to use diligence in procuring a buyer subjected himself to a possible suit for specific performance obligated himself to open a special trust account |
A: agreed to use diligence in procuring a buyer Procuring cause only becomes applicable when the property is sold. A trust account needs to be in existence only upon receipt of earnest money. |
|
|
All of the following are true regarding the Exclusive Right-to-Sell listing contract except: there is a one contract for all types of listings a listing contract may establish seller-agency a listing contract may be executed without establishing agency more than one listing contract may be executed for the same time period, for the same property |
A: more than one listing contract may be executed for the same time period, for the same property The Right to Sell Listing contract provides exclusivity to the listing broker to sell the property. The broker will be entitled to compensation regardless of who sells the property. If there is more than one listing contract active at the same time, the seller could be liable for multiple commissions to be paid. Commission Rule E-13 does not allow a real estate licensee to enter into an exclusive listing agreement with a seller if there is a listing contract currently in force with another licensee. It allows a listing contract executed that will become effective upon the expiration of the listing currently in force - but the two cannot be in effect concurrently. More info about agency and non-agency relationships: The reason the third answer is true (and therefore not the right answer to this question), a listing contract can be executed without establishing agency by simply checking the Transaction Broker box. At that point the licensee is not an agent (with agency duties) but a Transaction Broker. If the Seller Agency box was checked an agency relationship would have been established.The understand why a Transaction Broker is not an agency relationship you have to understand the agency relationship. An agency relationship is a consensual relationship created by contract or by law where the principal grants authority to the agent to act on behalf of and under the control of the principal to represent the principal with a third party. Only the Buyer and Seller Agency relationships are agency relationships.When you are a Transaction Broker you are in a "working relationship" not an "agency relationship". The Transaction Broker is a neutral party, much like a referee in a sport, the TB can assist with the transaction, but cannot advise the principal as to the risks or benefits of the transaction, nor can the TB become an advocate for the interests of the principal. Those are duties reserved to an agency relationship where the Buyer or Seller Agent is a coach for the principal. An agency relationship is referred to as "fiduciary" as the actions and words of the agent with a third party bind the principal. A TB is not "fiduciary" as the words and actions of the TB DO NOT bind the principal. The only items which bind the principal when a Transaction Broker is involved are the contracts signed by the principal. |
|
|
According to the Exclusive-Right-to-Sell Listing Contract, which of the following is true with regard to fixtures listed on the approved form? they are included unless they are crossed out on the form they are included if attached on the date of the listing unless specifically excluded by the seller they are included in every case they are included if they are on the property at the time of the listing |
A: they are included if attached on the date of the listing unless specifically excluded by the seller Unless excluded by the seller, all fixtures will be included. A fixture is any physical property that is permanently attached to real property. All other property which is not permanently attached is Personal Property. |
|
|
The listing broker, AAA Realty, shows a house to the Smiths two days before the listing expires. The listing has a 30-day holdover period, no box was checked in the Holdover clause in the Listing Contract. The buyers call the broker back four days after seeing the house and want to buy it. The sellers have listed the house with another broker, Rogers Realty. The sellers accept the offer of the Smith’s from AAA realty to buy the house. Which of the following is true? AAA Realty is not entitled to a commission Rogers Realty is entitled to the listing and selling commission AAA gets the selling (buyers) commission and Rogers Realty gets the listing commission AAA Realty is entitled to the listing and the selling commission |
A: AAA gets the selling (buyers) commission and Rogers Realty gets the listing commission The new listing terminated the holdover period. Therefore AAA cannot claim a listing side commission, Rogers Realty is going to receive the listing commission. However, since AAA is now representing the buyer, they will be entitled to the buy side commission. There is a checkbox in the Holdover Clause which would have allowed the Holdover clause to survive re-listing the property. Since this box was not checked, the Holdover period ended when the property was re-listed. The Holdover Period says that a listing broker may be entitled to a commission after the expiration of a listing contract for the period of time specified in the clause if: 1) the broker negotiated with the buyer during the listing period and 2) the broker submitted the name of this buyer in writing to the seller. Although the protection is for a negotiated time after the listing expires; it can terminate early if the property is re-listed by another agent and the "Will Not" box is checked, meaning the old listing agent "shall not" be owed a commission if another brokerage firm has earned one. If neither the "Will" or "Will Not" be owned a commission" box is checked - the default is "Will Not". See "Holdover Period" in the "When Earned" clause of an Exclusive Right to Sell listing agreement. |
|
|
All of the following would permit a listing agreement to be terminated except: destruction of the listed property because the seller found out that the broker was listing other homes and as such was not "exclusive" seller refusal to permit showings to minorities a breach of the terms by the broker |
A: because the seller found out that the broker was listing other homes and as such was not "exclusive" The seller may not terminate a listing because the broker had other clients and was listing their properties. "Exclusive" in the title "Exclusive Right to Sell" agreement means the broker has exclusive rights to market the property. |
|
|
A broker representing an owner in a listing contract to sell a parcel of land is a(an) general agent. special agent. common agent. agent in cause. |
A: special agent A broker is a special agent. You are hired to perform only one job, sell the land. |
|
|
A real estate broker filling out a listing agreement finds that there is not enough room for the legal description. The broker may: Abbreviate the description, as it must fit within the body of the contract Use only the street address as it is shorter Insert the legal description on MLS in lieu of the listing agreement Attach the legal description as information may be added outside the body of the contract |
A: Attach the legal description as information may be added outside the body of the contract The legal description can be added as an attachment to the contract on an addendum, or amend & extend form. |
|
|
Listing information: may be added outside the body of a contract as an attachment can never be added outside the body of a contract may be obtained after the listing agreement has been signed by the buyer and the broker none of the above |
A: may be added outside the body of a contract as an attachment Listing information may be added outside of the body of the listing contract by an Amend & Extend With Broker or addendum, and is usually obtained after the contract has been signed.i.e., MLS info, title info, etc. |
|
|
Which of the following is true in describing how a dispute about the Exclusive-Right-to-Sell Listing Contract between seller and broker would be resolved? Both must agree to mediation before proceeding to arbitration or litigation. The matter must be resolved by a real estate commission hearing. Both must agree to submit to arbitration with the local Realtor association. Both must agree to submit the matter to binding mediation. |
A: Both must agree to mediation before proceeding to arbitration or litigation. The listing contract forms are specific in requiring mediation in good faith before submitting the matter to arbitration or litigation. |
|
|
Which of the following is true concerning listings based on a "net price?" they are illegal in Colorado they are more profitable because no minimum is set on the amount of commission they are legal in Colorado as long as the seller agrees, and the broker has the necessary form prepared by an attorney representing one of the parties to the transaction. they are permissible with approval of the real estate commission |
A: they are legal in Colorado as long as the seller agrees, and the broker has the necessary form prepared by an attorney representing one of the parties to the transaction. Net listings are legal in Colorado. Because of the potential for conflict of interest between the seller and broker, they can be problematic. |
|
|
Under the approved listing agreement, the broker is responsible for: all damage occurring to the premises maintenance of the premises damage caused by the broker’s negligence only punitive damages caused by broker’s negligence |
A: damage caused by the broker’s negligence If the broker causes any damage to the property he/she are responsible. |
|
|
The Exclusive Brokerage Listing Addendum attached to an Exclusive Right to Sell Agreement Removes the seller's vicarious liability for activities of the broker Eliminates the broker's confidentiality duties Allows the seller to sell to anyone after the listing period is expired Allows the seller to negotiate a sale and not pay the broker |
A: Allows the seller to negotiate a sale and not pay the broker This contract allows the seller to sell the property on their own, and also allows the broker to sell the property. If the seller sells it before the broker, then the broker is out. |
|
|
An agent lists a property using the Colorado Exclusive Right to Sell Listing Contract and checked the "Shall Not" box in the Holdover Clause. Just before the listing expired, a buyer views the property. Wanting to retain the rights to this buyer, the listing agent provides the buyer's name in writing to the seller. After the listing expires, the seller lists with another agent and the buyer's agent submits an offer on the property. If accepted, would the old listing agent receive a listing commission? No, the new listing broker earned the listing side commission Both the new and the old listing brokers are entitled to a listing commission Yes, because it is within the holdover period Yes, because he is the procuring cause of the sale. |
A: No, the new listing broker earned the listing side commission Only the current listing broker earns the commission. Checking the "shall not" box in the Holdover clause indicated that the provisions of the clause would no longer be in effect should the property be relisted with another agent. When the property was relisted - the old listing agent lost the right to a listing commission for the buyer. If the old listing broker had checked the "shall" box, he/she would have been entitled to a listing commission under the terms of the Holdover clause. |
|
|
An Exclusive Right-to-Sell Listing contract establishes which of the following agreements? That the broker will never sue the seller That the seller will never sue the broker That the broker and the seller will use the same attorney That the broker and the seller will submit to mediation prior to litigation |
A: That the broker and the seller will submit to mediation prior to litigation Mediation provision: Mediation provides for disputes between the parties, to submit the matter first, to mediation. |
|
|
The amount of commission a listing broker offers to cooperating brokers: is specified by antitrust law is inserted into the listing contract is regulated by MLS is determined by the actual costs the respective brokers incur |
A: is inserted into the listing contract Commissions are negotiable and included in the listing contract. |
